Work

Structural Change in a Multi-Sector Model of Growth

Year: 2004

Type: preprint

Abstract: We study a multi-sector model of growth with differences in TFP growth rates across sectors and derive sufficient conditions for the coexistence of structural change, characterized by sectoral labor reallocation, and constant aggregate growth path. The conditions are weak restrictions on the utility and production functions commonly applied by macroeconomists. We present evidence from US two-digit industries that is consistent with our predictions about structural change and successfully calibrate the historical shift from agriculture to manufacturing and services. We show quantitatively that reasonable deviations from our conditions do not have a big impact on the properties of the model.

Source: SSRN Electronic Journal

Authors: Rachel Ngai, Christopher A. Pissarides

Institutions: Hong Kong University of Science and Technology, London School of Economics and Political Science

Language: English

Topic: Economic Growth and Productivity

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: green

OpenAlex ID: W1966588351

Cites: 21

Cited by: 77

Related to: 10